Despite bleak headlines plaguing the pharmaceutical and biotech industry as a whole, there are definite signs of life, says Sugar Land, Texas-based Industrial Info Resources (IIR), at least in terms of current active project spending for 2008. According to recent analysis of current data within IIR's Pharmaceutical Tracker, more than 537 projects should begin construction in 2008 worth an estimated $21 billion.
Although money is being invested in pharma-biotech capital projects, the green light is being delayed for a number of reasons. When considering these projects and comparisons between different time periods, it's important to remember that construction start dates are arbitrary and subject to constant change. Indeed, a good number of the projects scheduled to now kick off in 2008 were originally set to begin in 2007 or even earlier.
According to IIR, the 2008 figures represent an increase of $6.7 billion over 2007 project starts, a gain of 45%. In terms of the number of projects, 2008 shows an addition of 122, or 30% more than the 415 projects in 2007. For 2008, the average total investment value (TIV) is $39 million, yet another increase over the 2007 figure of $34.6 million.
A regional look at the 2008 activity reveals that in terms of TIV (click here to see Chart), the West Coast garners top honors with $3.6 billion distributed over 62 projects. The Mid-Atlantic region grabbed second place, with a healthy $3.1 billion launching 71 projects, followed by New England with its $1.9 billion funding 20 projects.